Defective concrete blocks – Opening Statement by BPFI at the Joint Committee on Finance

Opening Statement by Brian Hayes, Chief Executive, Banking & Payments Federation Ireland at the Joint Committee on Finance, Public Expenditure and Reform, and Taoiseach – Wednesday 1st May 2024

Let me start by acknowledging the appalling situation faced by homeowners, through no fault of their own, due to the presence of defective concrete blocks in their homes. BPFI and our members reiterate our commitment to support these homeowners where possible, and to continue to engage proactively on issues where the banking sector has a role to play and where we believe we can make a positive contribution.

At an industry level, BPFI has been working on an ongoing basis with our members and stakeholders to consider any constructive solutions that might be appropriate. In the last 12 months in particular, we have engaged extensively with members and a wide range of external stakeholders including:

  • Homeowners, through the Redress Focus Group – Banking and Insurance.
  • Government, primarily through officials at the Department of Housing and the Department of Finance.
  • The Central Bank of Ireland.
  • The Irish Banking Culture Board.
  • Representatives of State Agencies tasked with the roll-out of the Enhanced Defective Concrete Blocks Grant Scheme, including the County and City Management Association (CCMA) representing local authorities, and the Housing Agency.
  • Other stakeholders including Engineers Ireland, Insurance Ireland, and the Law Society of Ireland.   

We have also worked with our members at industry level to confirm the position regarding mortgageability; to clarify the position regarding mortgage clause 12.2.9; to submit a proposal for an interim funding mechanism to the Department of Housing; and have hosted an information session for elected representatives on that proposal in September last year, which was attended by some members of this Committee.

In July last year, BPFI requested the establishment of an oversight committee by the Department of Housing to oversee implementation of the Enhanced Defective Concrete Blocks Grant Scheme (the Grant Scheme) and to address any issues that might arise. In a very welcome development, the Department of Housing hosted the first meeting of the Implementation Steering Subgroup in January and a follow-up meeting last week. This forum is of utmost importance to the implementation of the Grant Scheme, to provide a forum for all stakeholders to engage in one group. We believe it is of critical importance that the Department of Housing continues with the Subgroup, to give assurances of its commitment to continue engagement through the forum.

I now refer to the three main items referenced in your letter and the response by the sector to those issues. 

  1. Firstly, the mortgageability of properties impacted by defective concrete blocks …

Last December, BPFI made available to relevant stakeholders its position on mortgageability. This confirmed members’ (AIB, EBS & Haven, Bank of Ireland and PTSB) willingness to lend based on the certification and professional opinion provided by others in the conveyancing process, as per the standard process by which mortgages are approved. This position is confirmed in respect of all remediation options, 1 to 5, under the Grant Scheme. It also applies to the future sales of remediated properties; to the switching of mortgages attached to remediated properties; and to future top-ups.

Considering a recent statement by the Mica Action Group and the publication of a research update regarding the review of IS:465, BPFI and members await a formal response from the Department of Housing in relation to this aspect of the Scheme. We note the content of the update and the concerns raised in relation to the impact of defective materials on the foundations and in retained blockwork. Concerns have existed for some time regarding the review of IS:465. May we respectively suggest to the Committee that the work of the National Standards Authority of Ireland in this matter is now critical.

  • In relation to Bank Financing …

During our engagement with the Redress Focus Group, a potential challenge was identified with funding the commencement of remediation works, prior to receipt of the first grant payment. Last September, BPFI and members submitted a proposal for an interim funding mechanism to the Department of Housing for its consideration. In the proposal, we outlined an approach whereby a certain percentage of the amount approved under the Grant Scheme would be made available to the homeowner to fund upfront costs.

Last week, we were informed by the Department of Housing that it is working to finalise the details of a process that would allow for earlier access to funds approved under the Grant Scheme. We very much welcome the Department’s work to permit earlier access to funds, which is a more effective solution for impacted homeowners. We understand a commitment was made by the Department of Housing to bi-laterally discuss this new approach directly with effected residents and we welcome this engagement.

  • Regarding the treatment of mortgage holders with respect to properties impacted by defective blocks …

There is a clear desire across Ireland’s lenders to support and work with customers to find solutions. It should be noted at this point however that to date the volume of customers coming forward to our members remains low, with just over 370 having engaged with the three retail banks.

Examples of how members have supported customers includes:

  • The establishment of dedicated specialist teams which have been designated as points of contact, both centrally and at a local level, concentrated in the counties that are currently within scope of the Grant Scheme. Specific procedures are in place to ensure impacted homeowners are supported in line with their individual needs.
  • Ensuring frontline staff are fully and sensitively trained to work with impacted homeowners, which has included the training of frontline staff by vulnerable customer experts.
  • Working with customers on a case-by-case basis and mindful of their individual circumstances, members have provided credit to fund remediation works.  

Chairman we recognise the significant challenge for affected homeowners and believe continued engagement and constructive dialogue between stakeholders is imperative to move this issue forward. 

The banking sector is just one player of many in the overall process including the National Standards Authority of Ireland, solicitors, valuers, surveyors, the construction sector, local authorities, and others, and we would urge the Committee to consider seeking the view of all those who have a role to play in reaching the best possible outcome for impacted homeowners.

My colleague and I would be happy to answer any questions you may now have.

Thank you.


Note: Banking & Payments Federation Ireland (BPFI) represents the banking, payments and fintech sector in Ireland. Together with its affiliates, the Federation of International Banks in Ireland, and the Fintech & Payments Association of Ireland, BPFI has over 125 member institutions and associates, including licensed domestic and foreign banks and institutions operating in the financial marketplace.

For further information contact: Fiona Murphy, Head of Communications, 087 9740046, or Jillian Heffernan, Director of Communications, 087 9016880 or